Wednesday, October 12, 2005

London is the problem for Scottish business

Iain MacWhirter, in The Herald, 12 October 2005, wrote about Scotland's poor rate of business start-ups, running at less than one-third of England's.

According to MacWhirter:

1. Certain areas are well sown-up by informal cartels. Try to muscle in on the estate-agent business, the law, or Scottish financial services in Edinburgh and you'll find you won't get very far if you haven't been to the right school.

2. In the Highlands, most of the private sector is run by incomers, largely because local Scottish businessmen preferred to sell up and retire.

3. What tends to happen to most indigenous Scottish businesses, once they get going, is that their owners sell them to English-based companies.

4. Most people who try to set up in business find that it is a lot easier to set up in the south-east of England. Why? Because there are lots more people there with high salaries and more money to spend.

5. Why are salaries so much higher in England? Because there are more skilled people, capable of adding value and more businesses employing them to do precisely that.

6. Why aren't there more of these capable people in Scotland? Answer: because most of them have left Scotland to work in England.

For decades, centuries even, we have been exporting skilled and educated workers and entrepreneurs who find that the best opportunities lie in England or abroad.

7. The magnetic attraction of the metropolis is the greatest inhibitor of Scottish enterprise. If anything is "crowding out business" it is London.

8. If Scotland is to start growing again, it must somehow level this billiard table by creating a climate in which capital and skills remain here instead of migrating south.

9. This can only mean a structure of fiscal incentives which will keep Scottish businesses in Scotland, encourage new ones to form and attract established businesses from abroad.Only then will the state diminish in relative size.

10. The amazing thing is that just about everyone agrees with this analysis – even the Scottish Tories, who are now taking fiscal autonomy seriously.



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